GC: n
S: Investop – https://www.investopedia.com/ask/answers/033115/what-are-differences-between-treasury-bond-and-treasury-note-and-treasury-bill-tbill.asp (last access: 1 December 2024); Fidelity – https://www.fidelity.com/learning-center/smart-money/treasury-bills-vs-bonds (last access: 2 December 2024).
N: 1. – treasury (n). c. 1300, tresourie, “room or house where treasure is laid up; building or vault in which wealth, precious stones, etc., are stored and kept safe,” from Old French tresorie “treasury” (11c.), from tresor (see treasure (n.); for second element see -y (1)).
The meaning “department of state that controls public revenue” is recorded from late 14c. Specifically by 1706 as “place where public revenues are deposited and kept and where the funds to pay expenses of government are disbursed.” Treasury bill is attested by 1797.
An Old English word for “room for treasure” was maðm-hus and for “treasury,” feo-hus (for first element, see fee (n.)); Middle English also had treasure-house (tresour-hous, mid-13c.).
- Treasury (Capital T).
a: a governmental department in charge of finances and especially the collection, management, and expenditure of public revenues.b: the building in which the business of such a governmental department is transacted. -
Treasury plural also Treasurys: a government security (such as a note or bill) issued by the Treasury.
– bill (n): [written statement] late 14c., “formal document; formal plea or charge (in a court of law); personal letter,” from Anglo-French bille, Anglo-Latin billa “a writing, a list, a seal,” from Medieval Latin bulla “decree, seal, sealed document,” in classical Latin “bubble, boss, stud, amulet for the neck” (hence “seal”); see bull (n.2).
The sense of “written statement detailing articles sold or services rendered by one person to another” is from c. 1400; that of “order addressed to one person to pay another” is from 1570s. The meaning “paper intended to give public notice of something, exhibited in a public place” is from late 15c. The sense of “paper money, bank-note” is from 1660s. The meaning “draft of a proposed statute presented to a legislature” is from 1510s.
2. A Treasury bill—also called a T-bill—is a short-term debt obligation (essentially a short-term loan) issued by the federal government. These bills mature in one year or less from the date of purchase. This means you will see repayment of the amount borrowed plus interest within 12 months. Due to their short terms and lower risk (because they’re backed by the US government), T-bills tend to offer lower returns compared to stocks or even many corporate or municipal bonds.
When you buy a T-bill, you pay less than its face value and then receive the bill’s face value when it matures. This represents the bill’s “interest” payments and is only paid out at the end of the term, not regularly, unlike many other bonds. Therefore, you won’t recoup the full face value if you sell your Treasury bills before maturity.
You can keep a T-bill until it matures or sell it before then on the secondary market. Interest earned on a T-bill is subject to federal taxes but not state or local income taxes.
Their short-term nature and high liquidity make Treasury bills appealing to some investors. Since these investments are often viewed as relatively safe, demand is generally consistent. And though they usually offer lower returns than Treasury bonds or notes, this may not always be the case. For most of 2023 and into 2024, short-term Treasurys have yielded more than medium- and long-term Treasurys—aka an inverted yield curve.
| A quick look at Treasury bills | |||||
| Maturities available | When interest is paid | How interest is taxed | Liquidity | Volatility | Typical returns compared to Treasury bonds and notes |
|---|---|---|---|---|---|
| 4, 8, 13, 17, 26, and 52 weeks | At maturity | Income exempt from state and local taxation; federal tax due on interest earned. | High | Low | Lower |
3. Loans; Investment; Public Sector Budgeting: Treasury bill, T-bill.
- A short-term certificate of indebtedness issued by the Government of Canada to pay a sum of money on a given date, and having the following characteristics: issued at a discount in lieu of interest payments; maturity: 3, 6 or 12 months; issued in Canadian currency only; transferable; bought and sold on the open market.
- Treasury bill: term officially approved by the Study Group on Accounting Terminology (SGAT).
4. Treasury bills (T-bills) are short-term investments that mature in one year or less.
Treasury notes have maturities ranging from two to 10 years.
Treasury bonds offer the longest commitment, taking 20 or 30 years to mature.
S: 1. Etymonline – https://www.etymonline.com/search?q=Treasury+bill (last access: 1 December 2024); MW – https://www.merriam-webster.com/dictionary/treasury (last access: 1 December 2024). 2. Fidelity – https://www.fidelity.com/learning-center/smart-money/treasury-bills-vs-bonds (last access: 1 December 2024). 3. TERMIUM PLUS – https://www.btb.termiumplus.gc.ca/tpv2alpha/alpha-eng.html?lang=eng&i=1&srchtxt=Treasury+bill&index=alt&codom2nd_wet=1#resultrecs (last access: 1 December 2024). 4. Investop – https://www.investopedia.com/ask/answers/033115/what-are-differences-between-treasury-bond-and-treasury-note-and-treasury-bill-tbill.asp (last access: 1 December 2024).
SYN: T-bill
S: TERMIUM PLUS (last access: 1 December 2024)
CR: Treasury bond, Treasury note.
